Equity markets struggled to gain traction around record highs Monday as they looked to a jam-packed week that includes the Fed chief's testimony before Congress and the jobs report.
Apple (AAPL) helped pace all 30 Dow Jones stocks lower with its 2.5% decline to $175.50. The iPhone maker lost $70 billion in market capitalization after the European Union slapped it with a $2 billion antitrust fine for thwarting competition from music streaming rivals through restrictions on its App Store.
But Apple wasn't the only Magnificent 7 stock to help drag markets lower on the day. Most mega-cap tech names pulled back after a red-hot run that took both the S&P 500 and Nasdaq Composite to record closes on Friday.
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Be that as it may, Nvidia (NVDA) bucked the trend in a big way Monday, gaining 3.6%. Anyone who put $1,000 into NVDA 20 years ago would be very pleased with the results today. NVDA ended the session with a market value of $2.13 trillion.
Elsewhere, upcoming changes were announced to the S&P 500. Super Micro Computer (SMCI) stock vaulted on being tapped for the benchmark index, but analysts think Deckers Outdoor (DECK) might be the better buy.
Economic calendar in focus
More than anything, the economic calendar will be in focus this week. And so experts say Monday's pause is understandable after such a run.
"The S&P 500 and the Nasdaq Composite are each up seven of the previous eight weeks and higher in sixteen of the last eighteen weeks," writes Anthony Saglimbene, chief market strategist at Ameriprise. "On the latter, that's the longest such winning streak in over fifty years."
Although Saglimbene notes "strength across the market this year seems to be building momentum," it's a fact of life that markets never move in a straight line. An upcoming week with heavy implications for interest rate policy is right to give investors pause.
On Wednesday, Fed Chair Jerome Powell heads to Capitol Hill for his semi-annual report to Congress. The Fed chief last appeared in front of Congress in June 2023, just as the central bank was nearing the end of its aggressive series of rate hikes that brought the federal funds rate to its current 23-year-high range of 5.25% to 5.5%.
While market participants are anxious for the Federal Reserve to start cutting interest rates, recent commentary from Powell and other central bank officials indicate they will not do so until they are certain inflation is coming down to the Fed's 2% target.
During this week’s semi-annual monetary policy report to congress, we expect Fed Chair Powell to emphasize that the FOMC is in no rush to cut," writes Michael Gregory, deputy chief economist at BMO Capital Markets.
Markets also have to digest the fact that on Friday, we get the mother of all economic reports: the next jobs report. After all, the remarkably robust labor market – and the rising wages that come with it – is making the Fed wary about rushing into rate cuts.
At the closing bell, the Dow Jones Industrial Average slipped 0.3%, while the broader S&P 500 ticked down 0.1%. The tech-heavy Nasdaq Composite lost 0.4% during the session.
Related content
- Best Blue Chip Stocks: 21 Hedge Fund Top Picks
- Stock Picks That Billionaires Love
- Best Dividend Stocks for Dependable Dividend Growth
-
Ten Cheapest Places to Live in TexasProperty Tax Looking for a cheap place to live in Texas? Look no further. These counties have the lowest property tax bills in the Lone Star State.
-
AI Is Missing the Wisdom of Older Adults: What It Means for YouAI will increasingly affect your healthcare and finances, but young workers are primarily designing the systems and getting most of the jobs.
-
The Three C's to Financial Success: A Financial Planner's Guide to Build WealthConsistency, commitment and confidence in your chosen strategy are more critical to your financial success than finding the 'perfect' financial plan.
-
A Financial Adviser's Guide to Solving Your Retirement Puzzle: Five Key PiecesIf retirement's a puzzle you're struggling with, try answering these five questions. The answers will guide you toward a solution.
-
You're Close to Retirement and Cashed Out: How Do You Get Back In?If you've been scared into an all-cash position, it's wise to consider reinvesting your money in the markets. Here's how a financial planner recommends you can get back in the saddle.
-
After the Disaster: An Expert's Guide to Deciding Whether to Rebuild or RelocateHomeowners hit by disaster must weigh the emotional desire to rebuild against the financial realities of insurance coverage, unexpected costs and future risk.
-
A Financial Expert's Tips for Lending Money to Family and FriendsWhat starts as a lifeline can turn into a minefield if the borrower ghosts the lender. Following these three steps can help you avoid family feuds over funds.
-
Stock Market Today: Good Feelings and Solid Data Lift StocksResilience and de-escalation defined another generally positive day for financial markets.
-
What the HECM? Combine It With a QLAC and See What HappensCombining a reverse mortgage known as a HECM with a QLAC (qualifying longevity annuity contract) can provide longevity protection, tax savings and liquidity for unplanned expenses.
-
721 UPREIT DSTs: Real Estate Investing Expert Explores the Hidden RisksPotential investors need to understand the crucial distinction between a REIT's option to buy a Delaware statutory trust's property and its obligation.
